Precious Metals Bull Market Not Over Yet, Analyst Says

Precious metals investors shouldn’t despair. The long-term outlook remains positive.

The recent drop in prices since August 2020 is just the calm before another leg up in a continuing bull market, a veteran analyst says.

“We see the current weak prices as the consolidation phase,” says Jeff Christian, managing partner of New York-based commodities research company CPM Group, in a recent video.

The SPDR Gold Shares
exchange-traded fund and the iShares Silver Trust
, which track gold and silver prices, fell 12% and 7.7% respectively over the period August 3, 2020 through Friday, according to data from Yahoo.

That pullback, or consolidation, came after a rally which started in late 2015 / early 2016 depending on which metal.

Many Wall Street professionals note that long term bull markets often get interrupted by periods of sideways price action after substantial rallies. In other words, the rally in any asset price including metals, will see periods when price increases either reverse slightly or pause for a while, before the charge higher continues.

The resumption of the bull market will depend on how the economy and the political environment shake out both domestically and internationally, he says.

Major Gold Rally Could Start in Less than Two Years

However, based on his company’s analysis Christian says in 2023 to 2025 he expects to see much higher gold and silver prices, perhaps even at “record levels.” That would mean a substantial rally for both commodities which recently fetched $1,750 and $22.38 a troy ounce respectively. The record levels for the metals were greater than $2,000 and over $48 respectively. Put another way, the rally in silver could be far more violent than the gold price increase.

Christian sees the recent inflationary surge as being temporary, and that interest rates will likely remain low for the next decade. Such low interest rates will not attract investors to ditch their gold holdings in favor of fixed-income securities.

Anyone wanting to benefit from the likely forthcoming rally should consider accumulating gold and silver bullion on price dips.

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